Question

The balance in beginning Work in Process at Marx Rubber Company for direct labor was $153,800. During the month of March, an additional $752,008 of direct labor was incurred, and 36,200 pounds of rubber were produced. At the end of March, 9,700 pounds of rubber were in process and the units were 40 percent complete. At the start of March, the company had 5,700 pounds of rubber that were 40 percent complete. Calculate the cost per equivalent unit for labor, assuming that labor is added uniformly throughout the production process. (Round answer to 2 decimal places, 6.3. 25.26.) Cost per equivalent unit $ per pound

Answer 1

$Cost per Equivalent Unit = \frac{Total Labor Cost}{Total Equivalent Units}$

$Cost per Equivalent Unit = \frac{\$905,808}{40,080}$

Working Note:

Direct Labor Beginning WIP March labor Total Labor Cost $153,800 $752,008 $905,808 Units Units Completed Equivalent Units (9700*40%) Total Equivalents Units 36,200 3,880 40,080

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